Equity Analyst - Asia Consumer Sector, Investory

Devi Subhakesan

Equity Analyst - Asia Consumer Sector

ASIA CONSUMER: INSIGHTS AND INVESTMENT IDEAS

Investory

Investory is a Singapore-based boutique independent equity research firm founded in January 2017 with a primary focus on consumption themes across Asia-Pacific.

We aim to generate investible ideas based on consumption trends and outlook. We screen our ideas on several parameters - product potential, long-term growth and management commitment being the most critical.  We follow a fundamental analysis approach in our stock selection process and are not restricted by market cap.

We aspire to grow into a leading source of unbiased research, free of conflict of interest, for investors yearning for independent and disciplined analysis. 

We also undertake bespoke research mandates to support our Institutional clients’ investment needs.

Our team comprises of professionals with extensive experience in the Asian equity markets, in areas ranging from research, servicing institutional clients and investment management.

Thematic (Sector/Industry)

Emerging Asia - notably China and India -  is witnessing a  steady expansion in the Male grooming sector as men's habits around personal care is shifting - led by a confluence of social, economic and compelling demographic factors. Expect this trend to gather more momentum as image-conscious young men adopt a wider array of personal care products. Skincare products that address specific needs/concerns of male customers will drive the early stage of segment growth; light cosmetics are picking up demand too. Companies that are quick to identify and address the demand with male-specific products/brands stand to gain from early mover advantage given male customers, reportedly, are far more brand loyal compared to female counterparts.
What is original in this report? We discuss the social, economic and compelling demographic factors driving the shift and growth in the Male grooming sector in China and India. We look at the emerging trends across segments and in both the markets to arrive at a pecking order in terms of investment potential. We have scanned the personal care and cosmetics products landscape to shortlist brands and companies that offer a male-specific product range. A brief on select companies - private and listed -  are presented for further investment analysis and evaluation.

Emerging Asia - notably China and India -  is witnessing a  steady expansion in the Male grooming sector as men's habits around personal care is shifting - led by a confluence of social, economic and compelling demographic factors. Expect this trend to gather more momentum as image-conscious young men adopt a wider array of personal care products. Skincare products that address specific needs/concerns of male customers will drive the early stage of segment growth; light cosmetics are picking up demand too. Companies that are quick to identify and address the demand with male-specific products/brands stand to gain from early mover advantage given male customers, reportedly, are far more brand loyal compared to female counterparts.
What is original in this report? We discuss the social, economic and compelling demographic factors driving the shift and growth in the Male grooming sector in China and India. We look at the emerging trends across segments and in both the markets to arrive at a pecking order in terms of investment potential. We have scanned the personal care and cosmetics products landscape to shortlist brands and companies that offer a male-specific product range. A brief on select companies - private and listed -  are presented for further investment analysis and evaluation. 

Male Grooming in Asia: Blooming Prospects. Skincare to Drive Growth

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Cross Asset Strategy

<div class="content-highlight">It has been reported in the past few days that <a href="http://www.koreaninvestors.com/?p=12175" target="_blank" rel="noopener">NPS</a> is likely to put a greater emphasis on ESG (environmental, social, &amp; governance) based investing for Korean stocks and bonds starting 2021. NPS has currently given a mandate to a company to help NPS to apply ESG based investment system. The ESG evaluations are expected to aid NPS to actively exercise shareholder rights and also to carry out negative screening of stocks.</div><h3>Implications of NPS Incorporating More ESG Criteria on Domestic Investments (Bonds &amp; Stocks)</h3><ul>
<li>Negative Impact on VICE industries </li>
<li>Positive Impact on Renewable Energy Industries</li>
<li>Negative Impact on Coal &amp; Oil Industries</li>
<li>Greater Representation of Women in Senior Management Team/BOD</li>
</ul>

It has been reported in the past few days that NPS is likely to put a greater emphasis on ESG (environmental, social, &amp; governance) based investing for Korean stocks and bonds starting 2021. NPS has currently given a mandate to a company to help NPS to apply ESG based investment system. The ESG evaluations are expected to aid NPS to actively exercise shareholder rights and also to carry out negative screening of stocks.Implications of NPS Incorporating More ESG Criteria on Domestic Investments (Bonds &amp; Stocks)
Negative Impact on VICE industries 
Positive Impact on Renewable Energy Industries
Negative Impact on Coal &amp; Oil Industries
Greater Representation of Women in Senior Management Team/BOD


NPS - Greater Emphasis of ESG Based Investing for Korean Stocks & Bonds Starting 2021

In this insight, we provide a data analysis of the inbound and outbound visitors in South Korea in 1Q 2020. The total number of visitors was down 15.2% YoY in January 2020, down 43% YoY in February and down a whopping 94.6% YoY in March. There were only 83,497 visitors to South Korea in March 2020 versus 1.5 million in March 2019. There were 3.7 million outbound visitors from South Korea in 1Q 2020, down 52.9% YoY. The outbound visitors from South Korea declined by 13.7% YoY in January 2020, down 60% YoY in February, and down 93.9% YoY in March.<div class="content-highlight">All in all, May could be a key turning point, including in South Korea as many key countries around the world start to end their partial lockdown measures. Although we are not exactly sure how this will turn out, we think that a lot of the positives on governments' response to COVID-19 already appear to have been reflected in the global indices including in KOSPI so a few negative news regarding an increase in COViD-19 cases after the end of the partial lockdown could result in their share prices falling again.  </div>

In this insight, we provide a data analysis of the inbound and outbound visitors in South Korea in 1Q 2020. The total number of visitors was down 15.2% YoY in January 2020, down 43% YoY in February and down a whopping 94.6% YoY in March. There were only 83,497 visitors to South Korea in March 2020 versus 1.5 million in March 2019. There were 3.7 million outbound visitors from South Korea in 1Q 2020, down 52.9% YoY. The outbound visitors from South Korea declined by 13.7% YoY in January 2020, down 60% YoY in February, and down 93.9% YoY in March.All in all, May could be a key turning point, including in South Korea as many key countries around the world start to end their partial lockdown measures. Although we are not exactly sure how this will turn out, we think that a lot of the positives on governments' response to COVID-19 already appear to have been reflected in the global indices including in KOSPI so a few negative news regarding an increase in COViD-19 cases after the end of the partial lockdown could result in their share prices falling again.  

South Korea Data Analysis of Inbound & Outbound Visitors in 1Q 2020

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Consumer Staples are a good inflation hedge, but only if they can pass on the increase in raw material costs to end consumers. In a scenario of high unemployment and collapsing demand this may not always be possible.We have taken a look at the change in short interest on Asian consumer staples names across Hong Kong, Korea, Taiwan and Japan to identify stocks that the market is betting on and against.There is a fair bit of variability among the HK and Taiwan stocks, short interest has been broadly lower in Korea and has been plummeting in Japan. Investors can use the data as one of the inputs in identifying stocks that could benefit from an increase in inflation in the near/medium term.

Consumer Staples are a good inflation hedge, but only if they can pass on the increase in raw material costs to end consumers. In a scenario of high unemployment and collapsing demand this may not always be possible.We have taken a look at the change in short interest on Asian consumer staples names across Hong Kong, Korea, Taiwan and Japan to identify stocks that the market is betting on and against.There is a fair bit of variability among the HK and Taiwan stocks, short interest has been broadly lower in Korea and has been plummeting in Japan. Investors can use the data as one of the inputs in identifying stocks that could benefit from an increase in inflation in the near/medium term.

Asian Consumer Staples - Inflation Hedge?

In this report, we provide South Korea's response to Japan's economic sanctions as well as an analysis of the recent visitors trend to South Korea and Japan. Plus, we analyze the likely probabilities of Abe and the Japanese government enforcing another round of economic sanctions on South Korea including visa restrictions to Japan. In our view, the first round of economic sanctions by Japan on South Korea may not be enough for President Moon Jae-In to change his mind. The higher probability event is that South Korea just waits and makes no major moves until Japan makes a few more economic sanctions on South Korea before the South Korean government is forced to give in. Right now, one of the growing probability is that Abe's Japanese government enforces another round of economic sanctions on South Korea including <a href="https://www.scmp.com/news/asia/east-asia/article/3001530/travel-firms-fear-japan-will-stop-visas-south-koreans-row-over" target="_blank" rel="noopener">restrictions on visas</a> of South Koreans to Japan in the coming weeks. We provide a list of stocks that will be negatively impacted by a potential visa restrictions of South Koreans to Japan.

In this report, we provide South Korea's response to Japan's economic sanctions as well as an analysis of the recent visitors trend to South Korea and Japan. Plus, we analyze the likely probabilities of Abe and the Japanese government enforcing another round of economic sanctions on South Korea including visa restrictions to Japan. In our view, the first round of economic sanctions by Japan on South Korea may not be enough for President Moon Jae-In to change his mind. The higher probability event is that South Korea just waits and makes no major moves until Japan makes a few more economic sanctions on South Korea before the South Korean government is forced to give in. Right now, one of the growing probability is that Abe's Japanese government enforces another round of economic sanctions on South Korea including restrictions on visas of South Koreans to Japan in the coming weeks. We provide a list of stocks that will be negatively impacted by a potential visa restrictions of South Koreans to Japan.

South Korea's Response to Japan's Sanctions and Recent Visitors Trend to Japan & South Korea

South Korea

LG H&H Co., Ltd. manufactures and distributes cosmetics. The Company produces whoo, o hui, sum 37, basic cosmetics, color cosmetics, and other related products. LG H&H also produces toothpaste, soap, detergents, healthy, personal care, and refreshing products.

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LG H&H (Pref) (051905 KS)

Male Grooming in Asia: Blooming Prospects. Skincare to Drive Growth

Steady expansion in the Male grooming sector in China & India is led by a generational shift in grooming habits and not a passing fad. Only a few...

Devi Subhakesan

NPS - Greater Emphasis of ESG Based Investing for Korean Stocks & Bonds Starting 2021

It has been reported in the past few days that NPS is likely to put a greater emphasis on ESG (environmental, social, & governance) based...

Douglas Kim

South Korea Data Analysis of Inbound & Outbound Visitors in 1Q 2020

In this insight, we provide a data analysis of the inbound and outbound visitors in South Korea in 1Q 2020. The total number of visitors was down...

Douglas Kim

Asian Consumer Staples - Inflation Hedge?

Consumer Staples are a good inflation hedge, but only if they can pass on the increase in raw material costs to end consumers. In a scenario of...

Brian Freitas

South Korea's Response to Japan's Sanctions and Recent Visitors Trend to Japan & South Korea

In this report, we provide South Korea's response to Japan's economic sanctions as well as an analysis of the recent visitors trend to South Korea...

Douglas Kim

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